Hodge's salary: It pays to be president
Published: Monday, November 25, 2013
Updated: Tuesday, December 3, 2013 00:12
According to Miami’s General Counsel Robin Parker, President David Hodge is eligible for an annual bonus up to 20 percent of his base salary of $409,209 . However, for five of the past six years, he has declined full or partial values of these bonuses.
“For a number of years, he has turned it down,” Parker said. “Starting in 2008, the Board [of Trustees] offered him a bonus, which he declined. He told the board that for the next three years, from 2009-11, he would not accept a bonus.”
She explained that those were years when the university did not have enough funds to grant raises to the other faculty and staff members, so Hodge did not want to accept additional money himself.
Not only has he denied his bonuses on many occasions, but also on one occasion, Hodge even forewent a portion of his base pay.
“In 2010, [Hodge] and several of the vice presidents took a 10-day furlough of work without pay,” Parker said.
As a result, the president’s salary took a $15,000 plunge that year.
However, that may seem like just another drop in the ocean with a base pay that totals several hundred thousand dollars. Hodge’s salary has gradually increased since he first took the position in 2006, starting at $325,000. For the 2013-14 fiscal year, his annual salary amounts to $409,209, according to the Director of University News and Communications Claire Wagner.
This number is determined by the Board of Trustees, which acts as the governing body for Miami. The board is comprised of nine in-state members who are appointed by the governor of Ohio, five non-voting national trustees who live outside of the state of Ohio, and two non-voting student trustees. Thought it is not a requirement for the position, Parker said most board members are also Miami alumni.
The Board of Trustees typically discusses the president’s pay in September of each year, at which time they evaluate his performance from the previous fiscal year (for Miami, this is July 1 – June 30).
“I think they look at performance,” Parker said. “Annually, they set goals and evaluate [Hodge] against the accomplishment of those goals. Then they consider other factors like the [economic] market.”
Sophomore Grace Remington said she would guess that the average university president probably makes a couple hundred thousand dollars, but according to findings from the Chronicle of Higher Education in 2011, the average salary for presidents of public universities was nearly twice as much as she estimated, at $383,800, and that of private universities only slightly higher at $386,000.
However, some of the nation’s highest-paid university presidents have far exceeded that number. Judging by base salary alone, Ohio State University’s E. Gordon Gee was last year’s (2011-12) highest-paid public university president in the country, at $830,439, according to an article by ABC News. Bonuses, or “compensation pay,” included, his salary totaled to more than $2 million dollars. In 2007, he was also the first public-college president to have a salary exceeding $1 million.
There are now four public university presidents and at least 36 private university presidents whose salaries exceed $1 million, according to Chronicle’s study in 2009.
The New York Times published an article showing that the four highest-paid presidents of private universities in the United States all have salaries that exceed $2 million, with Drexel University in number one with an overall compensation of almost $5 million.
The New York Times also found that the “typical president earned 3.7 times as much as the average pay and benefits of a full professor at the same institution.”
Miami’s numbers adhere quite closely to this, based on Wright State University’s 2012-13 Ohio Universities Faculty Salary Survey. According to the survey, the average salary for a Miami professor is $105,119, making Hodge’s base pay around 3.9 times that number.
Compared to others in his field, President Hodge’s salary begins to seem almost modest, but how does his salary as the president of Miami University compare to that of Barack Obama’s as President of the United States?
As a result of a change that took effect in 2000, which doubled the salary of the president of the United States, he has been making $400,000 annually, plus a $50,000 tax-exempt expense account. Technically, this means that President Hodge earned more last year (~$481,000) than President Obama did ($450,000).
Remington said that while she sees similarities in their salaries, it is difficult to draw parallels between the two.
“Honestly, I don’t know if those positions are comparable,” she said. “There is so much that is put into being the U.S. president, with so many departments to oversee and responsibilities to deal with. I would expect that he would get [paid] significantly more than what he does.”
However, Remington said she is not suggesting that university presidents are by any means overpaid.
“As for the presidents of colleges and universities, I think that price sounds normal,” she said. “It’s a hard job. It’s like being the CEO of a company, really. The school itself is a business and he is the president of that business.”
The heads of businesses are paid based on the success of their respective companies, and if Miami is, as Remington suggests, a business, then it only seems appropriate that our “CEO” be paid well.